Do you Need Product Recall Insurance?

A liability insurance program will not respond to a defect in the product, as the liability insurance responds to resulting injury or damage.

The consequence of this for a client is that the cost, administration and brand damage triggered by the recall can often be greater than the injury / damage.

Regulation 90 of the Australian Consumer Law relates to the cost associated to the supplier of the product to undertake the repair, replacement, re-provide the service / part and recompense the consumer. This cost is generally a self insured cost on the client.

Insurance can respond to the event (the defect) that triggers the need to repair / replace, which is often referred to as a Contaminated Product or Product Recall insurance policy.

Do you need Product Recall / Crisis Management?

A key financial risk is the exposure to a product recall, on the basis of a contamination, mislabelling, or malicious activity. Insurance programs can be created to provide protection against Accidental Contamination, Malicious Product Tamper or Product Extortion and we recommend that you consider this area of risk.

What are the Potential Insured Events?

Accidental Contamination

Malicious Product Tampering

Product Extortion

Government Recall

Alleged Contamination

Intentionally Impaired Ingredient

What losses can be covered?

Business Interruption

Replacement Costs

Recall Costs

Third Party Recall Costs

Consultants & Advisor Costs

Rehabilitation Expenses

Extortion Costs

The following case example is based on a real Product Recall event.

A manufacturer of chilled foods was contacted by their retailer customer, who advised several customer complaints had been reported of possible contamination of the dessert products. As the manufacturer was a small company with a turnover of only several million dollars, the contamination incident had the potential to cause a large loss to its bottom line.

Once a contamination was identified, it was agreed that the products needed to be withdrawn from sale as they posed a threat of injury if consumed.

The following kinds and magnitudes of losses are typical of this type of incident:

Replacement Cost: A$ 53,500

Recall Cost: A$ 40,000

Loss of Profit: A$ 10,000

Transport Cost: A$ 5,000

The cost of a crisis Management consultant can also be considered to provide expect advice right from the start, as well as helping to protect your brand and business reputation.

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By purchasing online:

• You are expected to self-manage your policy.
• There is no advice provided by Austbrokers Countrywide.
• You will need to manage your own claims directly with Austbrokers Life Solutions by calling 1300 161 635.• If you need to make changes to the policy, you will need to contact Austbrokers Life Solutions on 1300 161 635.

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By purchasing online:

• You are expected to self-manage your policy.
• There is no advice provided by Austbrokers Countrywide.
• You will need to manage your own claims directly with CHUBB by calling 1800 803 548.• If you need to make changes to the policy, you will need to contact CHUBB on 1800 803 548.

You are about to leave our site

By purchasing online:

• You are expected to self-manage your policy.
• There is no advice provided by Austbrokers Countrywide.
• You will need to manage your own claims directly with CGU by calling 1300 306 083.• If you need to make changes to the policy, you will need to contact CGU on 1300 306 083.

You are about to leave our site

By purchasing online:

• You are expected to self-manage your policy.
• There is no advice provided by Austbrokers Countrywide.
• You will need to manage your own claims directly with CGU by calling 1300 306 083.• If you need to make changes to the policy, you will need to contact CGU on 1300 306 083.

You are about to leave our site

By purchasing online:

• You are expected to self-manage your policy.
• There is no advice provided by Austbrokers Countrywide.
• You will need to manage your own claims directly with CGU by calling 1300 306 083.• If you need to make changes to the policy, you will need to contact CGU on 1300 306 083.